Instructions For Form 1120-Reit - 2009 (Page 16 of 17) in pdf

How to Report

See section 1563(d)(1) for the

Schedule L–Balance

definition of “stock” for purposes of

If the REIT checked the “Other” box,

determining stock ownership above.

attach a schedule showing the

Sheets per Books

computation of each item included in the

Question 5

The balance sheets should agree with the

total for line 6, Schedule J. In addition,

REIT’s books and records.

identify: (a) the applicable Code section;

Check the “Yes” box if one foreign person

Line 1. Cash. Include certificates of

(b) the type of taxes or interest; and (c)

owned at least 25% of (a) the total voting

deposits as cash on line 1.

enter the amount of tax or interest.

power of all classes of stock of the REIT

entitled to vote, or (b) the total value of all

Line 4. Tax-exempt securities. Include

Line 7–Total Tax

classes of stock of the REIT.

on this line:

•

State and local government obligations,

Include any deferred tax on the

The constructive ownership rules of

the interest on which is excludable from

termination of a section 1294 election

section 318 apply in determining if a REIT

gross income under section 103(a), and

applicable to shareholders in a qualified

•

is foreign owned. See section 6038A(c)(5)

Stock in a mutual fund or other RIC that

electing fund in the amount entered on

and the related regulations.

distributed exempt-interest dividends

line 7. See Form 8621, Part V, and How

during the tax year of the REIT.

to report, below.

Enter on line 5a the percentage owned

Line 24. Adjustments to shareholders’

by the foreign person specified in line 5.

Subtract from the total for line 7 the

equity. Examples of adjustments to

On line 5b, enter the name of the owner’s

deferred tax on the REIT’s share of the

report on this line include:

country.

undistributed earnings of a qualified

•

Unrealized gains and losses on

electing fund (see Form 8621, Part II).

securities held “available for sale.”

Note. If there is more than one

•

Foreign currency translation

25%-or-more foreign owner, complete

How to report

adjustments.

lines 5a and 5b for the foreign person with

•

Attach a schedule showing the

The excess of additional pension

the highest percentage of ownership.

computation of each item included in, or

liability over unrecognized prior service

subtracted from, the total for line 7. On

Foreign person. The term “foreign

cost.

•

the dotted line next to line 7, enter the

person” means:

Guarantees of employee stock (ESOP)

•

amount of tax or interest, identify it as tax

A foreign citizen or nonresident alien.

debt.

•

or interest, and specify the Code section

An individual who is a citizen of a U.S.

Compensation related to employee

that applies.

possession (but who is not a U.S. citizen

stock award plans.

or resident).

If the total adjustment to be entered

•

A foreign partnership.

on line 24 is a negative number, enter the

•

A foreign corporation.

Schedule K—Other

amount in parentheses.

•

Any foreign estate or trust within the

Information

meaning of section 7701(a)(31).

•

A foreign government (or one of its

Schedule M-1

Be sure to answer all the lines that apply

agencies or instrumentalities) if it is

to the REIT.

engaged in the conduct of a commercial

Reconciliation of Income (Loss)

activity as described in section 892.

Question 3

per Books With Income per

Check the “Yes” box if the REIT is a

Return

Owner’s country. For individuals, the

subsidiary in a parent-subsidiary

term “owner’s country” means the country

Line 5c. Travel and entertainment.

controlled group (defined below), even if

of residence. For all others, it is the

Include any of the following:

the REIT is a subsidiary member of one

•

country where incorporated, organized,

Meals and entertainment not deductible

group and the parent corporation of

created, or administered.

under section 274(n).

another.

•

Expenses for the use of an

Requirement to file Form 5472. If the

Note. If the REIT is an “excluded

entertainment facility.

REIT checked “Yes” to line 5, it may have

•

member” of a controlled group (see

The part of business gifts over $25.

to file Form 5472. Generally, a 25%

•

section 1563(b)(2)), it is still considered a

Expenses of an individual over $2,000,

foreign-owned corporation that had a

which are allocable to conventions on

member of a controlled group for this

reportable transaction with a foreign or

cruise ships.

purpose.

domestic related party during the tax year

•

Employee achievement awards over

must file Form 5472.

Parent-subsidiary controlled group.

$400.

•

The term “parent-subsidiary controlled

The cost of entertainment tickets over

See Form 5472 for filing instructions

group” means one or more chains of

face value (also subject to 50% limit

and penalties for failure to file.

corporations connected through stock

under section 274(n)).

•

ownership (section 1563(a)(1)). Both of

The cost of skyboxes over the face

Item 8

the following requirements must be met:

value of nonluxury box seat tickets.

•

Tax-exempt interest. Show any

The part of luxury water travel not

1. At least 80% of the total combined

tax-exempt interest received or accrued.

deductible under section 274(m).

voting power of all classes of voting stock

•

Include any exempt-interest dividends

Expenses for travel as a form of

entitled to vote or at least 80% of the total

received as a shareholder in a mutual

education.

value of all classes of stock of each

•

fund or other RIC.

Other nondeductible travel and

corporation in the group (except the

entertainment expenses.

parent) must be owned by one or more of

Item 9

the other corporations in the group and

For more information, see Pub. 542,

2. The common parent must own at

Enter the amount of the net operating loss

Corporations.

least 80% of the total combined voting

(NOL) carryover to the tax year from prior

Line 7. Tax-exempt interest. Include as

power of all classes of stock entitled to

years, even if some of the loss is used to

interest any exempt-interest dividends

vote or at least 80% of the total value of

offset income on this return. The amount

received by the REIT as a shareholder in

all classes of stock of one or more of the

to enter is the total of all NOLs generated

a mutual fund or other RIC.

other corporations in the group. Stock

in prior years but not used to offset

owned directly by other members of the

income in a tax year prior to 2009. Do not

Privacy Act and Paperwork Reduction

group is not counted when computing the

reduce the amount by any NOL deduction

Act Notice. We ask for the information

voting power or value.

reported on line 21a.

on this form to carry out the Internal

-16-

Instructions For Form 1120-Reit - 2009 Page 16

Related Articles

Related forms

Related Categories